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u bombs Libya 9 - ' ' ' i- I 8 Y A i . .... Tuesday, April 15, 1986 Jl Vol. 46 No. 44 Consumers see lower prices Editor's Note: This is the second article in a series on the lower oil prices and how they affect the American consumer. This installment will focus on the benefits of lower prices. by Chris J. Miller Managing Editor Everyone's heard the old adage, "What goes around, comes around." Oil prices seem to fit in this category. Following years of oil selling for over $20 a barrel, prices were halved this year and are now around $10 a barrel. With the drop in prices comes several benefits to the consumer. For years, OPEC (the Organization of Petroleum Exporting Countries) set the benchmark prices for crude oil, and other countries followed. But around 1983, output from Britain And they're off and Mexico increased, and some of the poorer OPEC countries began cheating on the quotas. "OPEC went from price takers, early on, to price makers," said Dr. John Hoftyzer, associate professor of economics at WSC. "Now they have become a price taker." With the breakup of the quotas, OPEC oil prices are more or less fluctuating back to their natural levels. Dr. Hoftyzer believes the prices will stabilize around $15-$20 a barrel. What does that mean to the consumer? "Things will be much better for the average American," said Dr. Hoftyzer. Apart from lower prices at the gas pumps, Dr. Hoftyzer mentioned other areas where consumers could see a reduction. These areas include housing and heating fuel prices. Another area is aviation fuel. "The airlines could save a lot of Racers are off and running President Reagan took military action against Libya last night in what is being termed as the largest American air raid since the Vietnam War. U.S. planes bombed five specific targets in the country. Reagan said Khaddafy was warned several weeks ago that the U.S. would retaliate against terrorist attacks. He said he had proof that Khaddafy was behind several terrorist attacks against American citizens, including the April 5 bombing of a nightclub frequented by U.S. military personnel. The attack was launched at 7 p.m. Eastern time; 2 "-:t Consumers money," said Dr. Hoftyzer. "Whether they will pass it on to the consumer, I don't know." One of the interesting points to watch in the situation will be the shift in the oil and automotive industries. The high oil prices of the 1970's caused the Midwestern worker to be laid off at the auto plants. Many of them moved to Texas, where they could get jobs in the oil in i . in Saturday's five-mile road race. ')v. W'y. . V at gas pumps ft have been feeling good at the pumps dustry. Now the shift in oil prices could reverse that. "In the '70's, there was a migration from Detroit to Houston; now they all may have to move back," he said. "It should be even better in Europe and Japan, because they won't suffer at all like we will in the oil fields." Dr. Hoftzyer spent six years in Saudi Arabia during peak oil producing times. He believes definite The race was sponsored by Continuing Ed. See results on page 16. a.m. in Libya. The targets were "terrorist related," according to Caspar Weinberger, Secretary of Defense, and included the military section of the Tripoli Airport and two barracks identified as Khad-dafy's headquarters in Tripoli. Criteria for the targets included that they cause minimum lateral damage (to protect the citizens of Libya), full consideration must be given for pilots' safety, and that the targets were being used for terrorist activity. (See REAGAN on page 6) " - Vl lately. Signpost photo Oscar Sosa good times are ahead for the American consumer; that is, if the government will allow them. "If there is just a passive behavior by the government, we'll be okay." said Dr. Hoftyzer. The final installment of this series will examine who is being hurt by low oil prices, how these good economic times could be ruined, and what the American government is doing about the situation. V o t e Today and Tommorrow y i ? it k Sit-nposi photoScott Miller

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u bombs Libya 9 - ' ' ' i- I 8 Y A i . .... Tuesday, April 15, 1986 Jl Vol. 46 No. 44 Consumers see lower prices Editor's Note: This is the second article in a series on the lower oil prices and how they affect the American consumer. This installment will focus on the benefits of lower prices. by Chris J. Miller Managing Editor Everyone's heard the old adage, "What goes around, comes around." Oil prices seem to fit in this category. Following years of oil selling for over $20 a barrel, prices were halved this year and are now around $10 a barrel. With the drop in prices comes several benefits to the consumer. For years, OPEC (the Organization of Petroleum Exporting Countries) set the benchmark prices for crude oil, and other countries followed. But around 1983, output from Britain And they're off and Mexico increased, and some of the poorer OPEC countries began cheating on the quotas. "OPEC went from price takers, early on, to price makers," said Dr. John Hoftyzer, associate professor of economics at WSC. "Now they have become a price taker." With the breakup of the quotas, OPEC oil prices are more or less fluctuating back to their natural levels. Dr. Hoftyzer believes the prices will stabilize around $15-$20 a barrel. What does that mean to the consumer? "Things will be much better for the average American," said Dr. Hoftyzer. Apart from lower prices at the gas pumps, Dr. Hoftyzer mentioned other areas where consumers could see a reduction. These areas include housing and heating fuel prices. Another area is aviation fuel. "The airlines could save a lot of Racers are off and running President Reagan took military action against Libya last night in what is being termed as the largest American air raid since the Vietnam War. U.S. planes bombed five specific targets in the country. Reagan said Khaddafy was warned several weeks ago that the U.S. would retaliate against terrorist attacks. He said he had proof that Khaddafy was behind several terrorist attacks against American citizens, including the April 5 bombing of a nightclub frequented by U.S. military personnel. The attack was launched at 7 p.m. Eastern time; 2 "-:t Consumers money," said Dr. Hoftyzer. "Whether they will pass it on to the consumer, I don't know." One of the interesting points to watch in the situation will be the shift in the oil and automotive industries. The high oil prices of the 1970's caused the Midwestern worker to be laid off at the auto plants. Many of them moved to Texas, where they could get jobs in the oil in i . in Saturday's five-mile road race. ')v. W'y. . V at gas pumps ft have been feeling good at the pumps dustry. Now the shift in oil prices could reverse that. "In the '70's, there was a migration from Detroit to Houston; now they all may have to move back," he said. "It should be even better in Europe and Japan, because they won't suffer at all like we will in the oil fields." Dr. Hoftzyer spent six years in Saudi Arabia during peak oil producing times. He believes definite The race was sponsored by Continuing Ed. See results on page 16. a.m. in Libya. The targets were "terrorist related," according to Caspar Weinberger, Secretary of Defense, and included the military section of the Tripoli Airport and two barracks identified as Khad-dafy's headquarters in Tripoli. Criteria for the targets included that they cause minimum lateral damage (to protect the citizens of Libya), full consideration must be given for pilots' safety, and that the targets were being used for terrorist activity. (See REAGAN on page 6) " - Vl lately. Signpost photo Oscar Sosa good times are ahead for the American consumer; that is, if the government will allow them. "If there is just a passive behavior by the government, we'll be okay." said Dr. Hoftyzer. The final installment of this series will examine who is being hurt by low oil prices, how these good economic times could be ruined, and what the American government is doing about the situation. V o t e Today and Tommorrow y i ? it k Sit-nposi photoScott Miller